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[2010] ZAWCHC 664
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Moosa N.O v Manuel (24852/09) [2010] ZAWCHC 664 (18 March 2010)
IN THE HIGH COURT OF
SOUTH AFRICA
WESTERN CAPE HIGH
COURT, CAPE TOWN
CASE NO: 24852/09
DATE: 18 MARCH 2010
In the matter between:
FAREED MOOSA
N.O
.............................................................................................................
Applicant
And
PIERRENE ANNE
MANUEL
..............................................................................................
Respondent
JUDGMENT: 18™ MARCH 2010
Riley, AJ:
[1] This is an urgent application in
terms of which applicant seeks an order directing respondent to sign
all transfer documents
or any other document or deed of whatsoever
nature and kind which may be necessary in order to give and effect
registration of
transfer at the Deeds Office, Cape Town in respect of
erf 1972 Ottery, situate in the City of Cape Town, Cape Division,
Western
Cape and in the alternative that the Sheriff of this Court be
authorised to sign same in stead of the respondent, should she fail
or refuse to do so.
[2] On the 21st November 2008 the
applicant was appointed as executor of the Estate of the late
Theodore Llewellyn Manuel ("the
deceased") and authorised
to attend to the liquidation and distribution of the deceased's
estate. The deceased died on 17
January
2008.
[3] At the time of his death the
deceased was married in community of property to the respondent.
[4] It appears that at least since the
appointment of the applicant there has existed extreme tension and
distrust between the applicant
and the respondent resulting in an
application under case no. 12042/08 before Allie, J in terms of which
respondent sought an order
prohibiting the Master of the High Court,
Cape Town from appointing the applicant as the executor in terms of
the last will and
testament of the deceased. In that matter the
interdict was sought pending the outcome of an action that respondent
intended instituting
in which she challenged the authenticity of the
signature of the testator and accordingly, the validity of the will.
[5] The applicant opposed the
application on the basis that the will is valid and that his
appointment as curator in terms of the
will is valid.
[6] The applicant further tendered, in
his opposing affidavit to proceed to administer the estate if he is
appointed as executor
but to refrain from making awards to
beneficiaries in terms of the will until an action that will be
instituted by the applicant,
challenging the validity of the will, is
finalised.
[7] Allie, J dismissed respondent's
application with costs and ordered that applicant shall not make
awards to beneficiaries in
terms of the will unless the respondents
proposed
action to challenge the validity of the
will is finalised. She ordered that respondent institute her action
within 30 days from
date of her judgment.
[8] The following is common cause:
(1) That the applicant is in fact the
executor of the estate of the deceased and that applicant is
authorised by letters of executorship
to attend to the liquidation
and distribution of the deceased estate.
(2) That the applicant compiled and
filed the first liquidation and distribution account of the deceased
estate with the Master.
(3) That part of the assets mentioned
in the liquidation and distribution account is a property situate at
3 Whim pie Lane, Ottery.
("the property") under Deed of
Transfer No. T40545/1999 which property is encumbered.
(4) That an amount of R594 349.00 which
is an interest bearing loan secured by a mortgage bond over the
property, is owing to Standard
Bank.
(5) That at the time of his death the
deceased was in arrears with his monthly instalments on the bond
account;
(6) That no payments have been made
towards this debt after the deceased's death and that the bank has
demanded payment of the amount
due.
[9] Applicant averred in his founding
affidavit that the deceased died without leaving any cash. That there
was no cash in the estate
to pay the Standard Bank debt and that all
the bank accounts of the deceased were overdrawn at the time of his
death. That in the
circumstances all the assets in the estate of the
deceased had to be liquidated so as to have them reduced to cash.
[10] He averred further that even
though properties owned by the deceased in Bridgetown and Crawford
yielded some rental that these
amounts had not been used towards
paying the Standard Bank debt as the monthly rental amount was
insufficient to settle the arrear
instalments and also to pay the
current monthly bond instalment.
[11] According to applicant he
experienced problems with the tenants who did not pay the rental and
he was forced to institute legal
proceedings against the defaulting
tenants.
[12] He admitted that the costs of the
administration of the estate, including the legal costs associated
with the various lawsuits
against the tenants were being funded out
of the rental income.
[13] At the hearing of the matter Mr.
Moosa, the appointed executor, who appeared on behalf of the
applicant contended that the
situation was untenable and could not be
left unattended as the deceased's estate was suffering severe
financial prejudice, which
was also to the detriment of the heirs and
the creditors.
[14] He contended that the sale of the
immovable properties were necessary as according to him it was the
only manner by which the
substantial liabilities in the estate could
be settled.
[15] It is not disputed that apart from
the arrear bond repayments and associated problems, the property has
been vandalised by
thieves who stole fixtures and fittings etc.
causing substantial damage to the property.
[16] The building has become
inhabitable and the water supply has been disconnected due to the
substantial arrears.
[17] On 28 August 2009 applicant
advertised the first liquidation and distribution account for the
period as specified by law. According
to applicant he is now in a
position to liquidate the assets in the estate in terms of the
Administration of Estates Act 66 of 1965
as the estate lay open free
of objections. This is disputed by the respondent.
[18] It is not disputed that in his
capacity as executor applicant signed a Deed of Alienation in respect
of the property for an
amount of R537 000.00 and that at the time
that this action was launched the transfer of the property was ready
to be effected
but for respondents refusal to sign the relevant
documents.
[19] Applicant advanced several reasons
why in his view the sale should be allowed to proceed and why this
would be to the advantage
of all the parties.
(See record para 35 to para 40 founding
affidavit)
[20] Mr. Moosa contended that
respondent's conduct has been wilfully unco-operative and obstructive
as is illustrated by inter alia
her action under case no. 12042/08,
her antagonistic attitude towards him which is illustrated by her
lodging two unsuccessful
complaints against him at the Law Society
and with reference to the criminal case she laid against him at the
South African Police
for an alleged forgery of the deceased's will.
[21] It is common cause that respondent
has also in the interim issued a summons against applicant in terms
of which she inter alia
claims that the deceased's will should be
declared null and void.
[22] According to the applicant,
respondent has not come up with any better offers even though the
respondent avers that the sale
price is not market related. For this
reason he contended that respondent had no basis in fact or law to
refuse to sign the sale
documents. He contended that under these
circumstances the court was therefore obliged to intervene.
[23] The respondent was represented by
Mr. Grobbelaar of the Cape Bar who, like the respondent's attorney of
record, are acting
on a pro bono basis.
[24] I am indebted to them for their
assistance in this matter.
[25] At the hearing of the matter
respondent's counsel raised a point in limine in regard to the fact
that applicant had not properly
complied with the provisions of
Section 47 of the Administration of Estate's Act, Act 66 of 1965
("the Act"). It was
disputed that Ronaldo Manuel to whom
the property had been bequeathed in terms of the deceased's will, had
furnished his approval
in writing. It was contended that the emailed
letter of consent did not contain the initials of the applicant or
the commissioner
of oaths.
[26] This point was however not pursued
further during argument when applicant indicated that he was prepared
to obtain the original
of the document concerned from Ronaldo Manuel
who was overseas, should respondent insist.
[27] In any event, I am not persuaded
that this deficiency, if it can be so described, is fatal to the
applicant's case.
[28] It is not my intention to deal
with respondent's case where it relates to her concerns regarding the
validity of the deceased's
will and the signature that appear
thereon. That is a matter which has already received some attention
when Allie J dealt with
the application referred to above, and it
will receive further attention when the matter regarding the validity
of the will eventually
goes to trial.
[29] The main thrust of the
respondent's case is that the first Liquidation and Distribution
Account of the applicant does not correctly
reflect the assets and
liabilities of the deceased's estate.
[30] As a result of her concerns she
instructed her attorneys to address correspondence to the Master
setting out her concerns and
or objections to the first liquidation
and distribution account.
[31] In essence respondent raised
concerns, inter alia about the fact that applicant has not properly
accounted for -
31.1 the amounts of rental received by
the applicant in respect of the property of the deceased leased by
him in the course of the
administration of the estate;
31.2 there was no reference or record
of what happened to the money that had been in the account of Brain
Wave Projects, a close
corporation operated by the deceased during
his life time;
31.3 there was no reference or record
of what happened to the proceeds of the Old Mutual life policies that
had been over her husband's
life.
31.4 apart from some deposit slips
there was no indication whatsoever how much money had been paid by
tenants in respect of lease
agreements;
31.5 applicant had failed to make
reference to a Standard Bank call account which the deceased operated
during his life time.
[32] It is common cause that applicant
responded to the respondent's objections by stating that he would
deal specifically with
the rental income, the Brain Wave Projects CC
account and the Old Mutual policies in a subsequent liquidation and
distribution
account.
[33] As at the date of the hearing no
further liquidation account has been lodged and
neither has the applicant provided the
respondent with a proper detailed explanation in regard to her
concerns or objections.
[34] Applicant conceded during argument
that he had not opened a separate estate late banking account to deal
with any monies or
proceeds due to the deceased estate. On his own
admission he stated that he had been paying the rental and all other
monies accruing
to the deceased's estate into his trust account. He
was unable to give a reasonable explanation as to why he had not
opened a separate
estate account and he was more importantly unable
to give a reasonable explanation as to why he had not attached to his
founding
or supplementary papers, an extract of the relevant
transactions and or entries in his trust account records.
[35] Section 28 of the Act provides
that:
"28 Banking accounts
(1) An executor -
(a) Shall unless the Master otherwise
directs, as soon as he or she has in hand monies in the estate in
excess of R1000.00, open
a cheque account in the name of the estate
with a bank in the Republic and shall deposit therein the monies
which he or she has
in hand and such other monies as he or she may
from time to time receive for the estate;"
[36] In my view the use of the words
"shall" in the section makes it clear that the provisions
of the section are peremptory.
[37] The practice of utilising an
attorney's trust account instead of opening a separate estate account
in terms of section 28 is
unhealthy and is to be frowned upon.
[38] Even though respondent clearly
raised the issue of substantial amounts of money being paid in
respect of the estate and which
accrued to the estate it is
surprising that the Master, fails to question the existence of such
payments, where the payments are
being held and whether they can be
accounted for. I express my concern in this regard with reference to
section 28(2), and section
28(5) of the Act.
[39] Section 28(2) of the Act provides
that:
"(2) Every executor shall,
whenever required by the Master to do so, notify the Master in
writing of the bank and the office
or branch of the bank which he or
she has opened an account referred to in subsection (1) and furnish
the Master with a bank statement
or other sufficient evidence of the
position of the account"
[40] Section 28(5) provides that:
" The Master and any surety of the
executor shall have the same right to information in regard to any
such account as the executor
himself or herself possesses, and may
examine all vouchers in relation thereto, whether in the hands of the
bank or of the executor."
[41] Notwithstanding respondent's
concerns and objections the Master has failed and neglected to
request the relevant information
as is provided for in section 28(2)
and section 28(5).
[42] Applicant could not explain why he
further in the alternative, did not prepare a detailed schedule of
income and expenses in
respect of the deceased's estate.
[43] I find that the detail he provides
in his founding affidavit of and about the income and expenses in
respect of the deceased
estates financial affairs is seriously
lacking in particularity and detail, particularly since he wishes
this court to make an
order based on the financial status of the
deceased's estate and or its abilities to settle its debts.
[44] Even though the respondent raised
valid concerns and objections to the first liquidation and
distribution account, the Master
has failed, refused and neglected to
provide respondent with a proper response to her concerns and
objections. This notwithstanding
several letters addressed to the
Master by respondent's attorneys.
[45] The respondent averred in her
opposing affidavit that since her objections had not been dealt with
by the Master that this
prevented the executor from liquidating and
distributing the deceased's estate as there has not been proper
compliance with Section
35 of the Act. At paragraph 39.2 on page 87
of the court record she states in her answering affidavit that:
"In spite of the fact that the
applicant in his answering letter stated that he would deal with
the further aspects as mentioned in
paragraph 26.19 above, he has to my knowledge not filed a further L&D
account dealing with
these aspects. The applicant therefore is not in
a position to liquidate assets in the estate or to settle its debts
before any
objections have been addressed in terms of section 35 of
the Act."
[46] I now deal briefly with the
relevant provisons of the
Administration of Estates Act relating
to
objections.
[47]
Section 35(7)
provides that:
"Any person interested in the
estate may at any time before the expiry of the period allowed for
inspection lodge with the
Master in duplicate any objection, with the
reasons therefore, to any such account and the Master shall deliver
or transmit by
registered post to the executor a copy of any such
objection together with copies of any documents which such person may
have submitted
to the Master in support thereof.
Section 35
(8)
The executor shall, within fourteen
days after receipt by him of the copy of the objection, transmit two
copies of his comments
thereon to the Master.
Section 35(9)
If, after consideration of such
objection, the comments of the executor and such further particulars
as the Master may require,
the Master is of opinion that such
objection is well-
founded or if, apart from any
objection, he is of opinion that the account is in any respect
incorrect and should be amended, he
may direct the executor to amend
the account or may give such other direction in connection therewith
as he may think fit
Section 35(10)
Any person aggrieved by any such
direction of the Master or by a refusal of the Master to sustain an
objection so lodged, may apply
by motion to the Court within thirty
days after the date of such direction or refusal or within such
further period as the Court
may allow, for an order to set aside the
Master's decision and the Court may make such order as it may think
fit
Section 35(11)
If any such direction affects the
interests of a person who has not lodged an objection and the account
is amended, the account
as so amended shall, unless the said person
consents in writing to the account being acted upon, again He open
for inspection in
the manner and with the notice and subject to the
remedies hereinbefore provided.
Section 35(12)
When an account has lain open for
inspection as hereinbefore provided and -
(a) no objection has been lodged; or
(b) an objection has been lodged and
the account has been amended in accordance with the Master's
direction and has again lain open
for inspection,
if necessary, as provided in subsection
(11), and no application has been made to the Court within the period
referred to in subsection
(10) to set aside the Master's decision; or
(c) an objection has been lodged but
withdrawn, or has not been sustained and no such application has been
made to the Court within
the said period,
the executor shall forthwith pay the
creditors and distribute the estate among the heirs in accordance
with the account, lodge with
the Master the receipts and acquittances
of such creditors and heirs and produce to the Master the deeds of
registration relating
to such distribution, or lodge with the Master
a certificate by the registration officer or a conveyancer specifying
the registrations
which have been effected by the executor: Provided
that -
(i) a cheque purporting to be drawn
payable to a creditor or heir in respect of any claim or share due to
him and paid by the banker
on whom it is drawn; or
(ii) an affidavit by the executor in
which he declares that a creditor was paid or that an heir received
his share in accordance
with the account,
may be accepted by the Master in lieu
of any such receipt or acquittance.
[48] There is no evidence before me
that the Master has dealt with the respondent's objections as is
provided for in terms of the
law.
[49] On considering the provisions of
the Act relating to objections and based on the facts of this case, I
am accordingly satisfied
that applicant is not in a position to
liquidate the assets as there has not been proper compliance with
section 35 of the Act.
[50] It is further most unfortunate
that applicant has failed to take the court into his confidence by
not presenting to the court
a clear and detailed picture of the
status of the financial affairs of the deceased's estate.
[51] Instead applicant has accused the
respondent of being obstructive and being wilfully unco-operative
towards him in the time
that he has administered the estate. There is
no merit in this allegation.
[52] The respondent is the co-owner of
the property concerned and as such she has a vested interest in the
matters relating to the
deceased's estate. She is accordingly
entitled to question the manner in which the estate is being
administered and being dealt
with.
[53] I can therefore not find that her
conduct, in raising her concerns and objections with the Master
regarding the clear problems
in the first liquidation and
distribution account prepared and submitted by the applicant, is
unreasonable or obstructive. In my
view she is merely exercising her
rights. It appears that the applicant, fortified by the fact that the
Master appeared to be satisfied
with his response to the concerns and
objections raised by the respondent to his first liquidation and
distribution account and
his victory in the matter before Allie, J,
then launched this application on an urgent basis to this court.
[54] In my view the applicant could
have addressed all the respondent's concerns by providing her with a
detailed schedule of income
and expenditure in respect of the
deceased's estate. At the least he could have provided the respondent
with an extract of the
account of the deceased held in his attorney
trust account.
[55] He failed on both counts.
[56] In my view the matter could easily
have been resolved if he had done a proper accounting to the
respondent and or the Master
at the time that respondent raised her
concerns and or objections.
[57] I accordingly find that
applicant's decision to bring the application at the time that he did
was misguided.
[58] Based on what I have said
hereinbefore it follows that applicant's application falls to be
dismissed on the basis that:
(1) Applicant has failed to persuade me
that the deceased's estate is unable to pay the outstanding bond on
the property that he
wishes to have sold and or that the deceased's
estate is unable to pay any other debts of the deceased's estate.
(2) Applicant has further failed to
prove that there has been full compliance with the provisions of
section 35 relating to the
objections made by the respondent to the
Master.
[59] In conclusion I order that, even
though respondent has not asked for any cost order against applicant,
that applicant shall
not be entitled to claim any fees or
disbursements from the deceased's estate in his capacity as either
executor and or attorney
in relation to this application. In the
event that applicant has already debited fees on account of this
application he is ordered
to rectify the position immediately.
[60] I further direct that a copy of
this judgment be provided to The Master who must ensj^ret that Jhe
objections of the respondent
be dealt with in accordance with the
law.
RILEY AJ